Ben Bernanke: 'recession is over'

The worst US recession since the Great Depression is "very likely"
over, according to Ben Bernanke, chairman of the Federal Reserve.

Backed by positive retail sales and manufacturing data, Mr Bernanke's verdict yesterday comes from a "technical perspective" as the US showed signs of returning to positive growth in the current quarter.

However, speaking a year to the day since the collapse of Lehman Brothers, he said unemployment could remain a problem until 2010 and that the world's largest economy may feel weak "for some time".

His positive stance was supported by new figures showing that US retail sales rose by 2.7pc in August, the highest month-on-month increase in three-and-a-half years, partly as a result of the "cash for clunkers" car sale scheme.

In addition, the Federal Reserve Bank of New York's Empire State manufacturing index rose to its highest level since November 2007, a month before the recession officially began.